If you're 70½ or older, own an IRA, and give to charity, a qualified charitable distribution (QCD) is almost always the best way to do it.
How a QCD works
A QCD is a direct transfer from your IRA custodian to a qualifying charity. The amount is excluded from your income and counts toward your required minimum distribution. You don't get an itemized deduction for it, but excluding the money from AGI is usually worth more than a deduction would be.
| Rule | 2026 |
|---|---|
| Minimum age | 70½ on the date of the gift |
| Annual limit | $111,000 per IRA owner, indexed for inflation |
| One-time split-interest gift | $55,000 to a charitable remainder trust or gift annuity funded only by QCDs |
| Eligible accounts | IRAs, and inherited IRAs if the beneficiary is 70½, but not active SEP/SIMPLE plans or 401(k)s |
| Ineligible recipients | Donor-advised funds, most private non-operating foundations, supporting organizations |
A married couple with two IRAs can each give up to $111,000.
If you have retired but haven't reached RMD age, Summer Associates can model how different Roth conversion amounts affect your tax and Medicare premiums.The first consultation is free, with no obligation.
Book a free consultationWhy lower AGI matters
AGI drives several retiree-specific costs:
- Medicare IRMAA surcharges on Part B and D premiums.
- Taxation of Social Security, up to 85% of benefits.
- The new $6,000 senior deduction, which phases out above $75,000, or $150,000 for joint filers.
- Whether you cross the thresholds for the 3.8% net investment income tax.
In Connecticut
Connecticut starts from federal AGI and has no charitable deduction. A check to charity therefore saves no Connecticut tax, while a QCD keeps the money out of Connecticut income. Lower AGI also helps you stay under the $100,000 joint and $75,000 single lines, where the state's full exemptions for Social Security, pensions, and IRA withdrawals end. Our Connecticut retirement guide covers those lines in detail.
Key numbers: $111,000 QCD limit · age 70½ · one-time $55,000 split-interest gift · 0.5% AGI floor on itemized charitable deductions from 2026.
How the 2026 charitable rules favor QCDs
Starting in 2026, itemized charitable deductions count only to the extent they exceed 0.5% of AGI, and taxpayers in the top bracket get a benefit capped at 35 cents per dollar of itemized deductions. QCDs avoid both limits because they are never included in income.
A worked example
A 75-year-old couple has a $48,000 combined RMD, Social Security of $60,000, and gives $15,000 a year to their church. They take the standard deduction.
- Writing a check leaves the full RMD taxable, and the gift earns them nothing beyond the $2,000 non-itemizer deduction.
- A QCD of $15,000 lowers taxable IRA income to $33,000. That also makes $12,750 less of their Social Security taxable, so AGI drops $27,750 and federal tax falls by about $2,750 for 2026. Their income is well under the senior deduction phase-out, so they get the full $12,000 either way.
Common mistakes
- Taking the distribution yourself and then writing a check, which isn't a QCD.
- Sending a QCD to a donor-advised fund.
- Making deductible IRA contributions after 70½, which reduces the QCD exclusion dollar for dollar.
- Not reporting it correctly. Form 1099-R may not flag the distribution as a QCD, so your return must.
How Summer Associates helps
Summer Associates' retirement team builds an annual giving plan around your RMDs, coordinates the transfers with your custodian, and reports them correctly on your return.
Sources
This guide is general education based on federal and Connecticut law as of 2026-11-15. State rules differ and facts matter. Before acting, get advice for your situation from Summer Associates or another qualified advisor.